Credit Freeze vs. Fraud Alert
A freeze limits access to your credit report for new accounts; a fraud alert asks lenders to verify identity. Both are free, but setup differs.
By CreditCardDebt Staff3 min read
A credit freeze locks your credit report so most lenders can’t pull it, which makes it very hard for anyone to open new credit in your name. A fraud alert leaves your report open but tells lenders to verify your identity before approving anything. Both are free. For most people worried about identity theft, a freeze is the stronger option; a fraud alert is the lighter-touch one.
Credit freeze
You have to place a freeze separately with each of the three bureaus: Equifax, Experian and TransUnion. It takes a few minutes online at each. The freeze stays until you lift it, and it doesn’t affect your credit score.
Your existing cards and loans keep working normally. A freeze only blocks new credit checks. It doesn’t stop current creditors from reviewing your account, and it doesn’t prevent someone from misusing a card number they’ve already stolen.
When you apply for a loan, card, or apartment, you’ll need to lift the freeze temporarily. Ask the lender which bureau it uses and lift only that one, or lift all three for a set number of days. Online lifts usually take effect quickly, but don’t leave it until you’re standing at the car dealership.
Keep the login details for each bureau account somewhere safe. Recovering a lost account at three different companies is a tedious afternoon.
Parents can also freeze a child’s credit for free if the child is under 16. It’s one of the simplest ways to prevent child identity theft, which often goes unnoticed for years.
Fraud alert
To place an initial fraud alert, contact just one bureau; it’s required to tell the other two. The alert lasts one year and you can renew it. Lenders who see it are supposed to take extra steps to confirm it’s really you, often by calling the phone number you provide.
If you’re already a victim of identity theft and have an FTC identity theft report or a police report, you can get an extended fraud alert. It lasts seven years and also takes you off prescreened credit offer lists for five years. Active-duty service members can place an active duty alert, which lasts one year and can be renewed for the length of a deployment.
Which to use
- Your data showed up in a breach, but nothing’s been misused yet. A freeze at all three bureaus is the strongest prevention. If you’re about to apply for credit and don’t want the hassle of lifting it, a fraud alert is a reasonable stopgap.
- Someone has already opened an account in your name. Report it at IdentityTheft.gov, which builds a recovery plan and an identity theft report for you. Freeze your credit, then contact the lender and dispute the fraudulent account. Neither a freeze nor an alert removes an account that already exists.
- You want both. You can have a freeze and a fraud alert at the same time.
A few things a freeze won’t do
A freeze doesn’t stop you from checking your own credit reports, and you should still check them. You can get free weekly reports at AnnualCreditReport.com; How to Check Your Credit Score for Free explains the options.
It also doesn’t protect your bank account or existing cards. Keep watching statements and turn on transaction alerts. Credit Card Security and Fraud Prevention covers those habits.
Finally, a “credit lock” sold as part of a monitoring subscription isn’t the same as a freeze. A freeze is a free right under federal law. A lock is a product governed by the company’s terms. Check whether the free version already covers what you need before paying for anything.
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This article is for educational purposes and is not financial advice.